22
Taking the pulse of consumers Consumer Insights Survey 2018 August 2018

Consumer Insights Survey 2018 - PwC · PwC Global Consumer Insights Survey 2018 Key Facts 3 73% of consumers say the economy will perform better or the same 88% of consumers are willing

  • Upload
    others

  • View
    18

  • Download
    0

Embed Size (px)

Citation preview

Page 1: Consumer Insights Survey 2018 - PwC · PwC Global Consumer Insights Survey 2018 Key Facts 3 73% of consumers say the economy will perform better or the same 88% of consumers are willing

Taking the pulse of consumers Consumer Insights Survey 2018

1

August 2018

Page 2: Consumer Insights Survey 2018 - PwC · PwC Global Consumer Insights Survey 2018 Key Facts 3 73% of consumers say the economy will perform better or the same 88% of consumers are willing

PwC Consulting 2

PwC’s 2018 Global Consumer Insights SurveyExplore the highlights of our annual consumer behaviour survey of over 22,000 online shoppers in 27 territories across the globe

Photo credit - Unsplash.com

Page 3: Consumer Insights Survey 2018 - PwC · PwC Global Consumer Insights Survey 2018 Key Facts 3 73% of consumers say the economy will perform better or the same 88% of consumers are willing

PwC’s Digital Services

PwC Global Consumer Insights Survey 2018Key Facts

3

73%of consumers say the economy will perform

better or the same

88%of consumers are willing to pay for same-day or

faster delivery

94%of 18-24 year olds use social media to inspire

their purchases

42%have already purchased or

plan to purchase a consumer AI device

52%say they are concerned

about security when making mobile payments

<50%say they are satisfied with

the in-store shopping experience

PwC Consulting

Page 4: Consumer Insights Survey 2018 - PwC · PwC Global Consumer Insights Survey 2018 Key Facts 3 73% of consumers say the economy will perform better or the same 88% of consumers are willing

PwC Consulting

Consumer habits are continuously being reshaped and the retail industry need to anticipate and adapt to these in order to stay relevant

We see a continued strong trend toward online shopping. However, stores remain as the most important shopping channel and consumers expect a unique experience, combining in-store and online activities. See Nike’s concept stores in NYC and LA 4

Consumers turn to their peers and different influencers on social media to find inspiration. H&M is mastering the game

Trust is essential for retailers seeking to harness data about customers - and consumers still rely on retail companies

Global mega-players are reshaping and reinforcing consumer habits and expectations, in turn disrupting the market

Each year our Global Consumer Insights Survey take the pulse of global consumers’ future behavior. Our Conclusion; Consumer habits and global mega-players are completely disrupting the retail market as we know it, while Asian consumers are driving the shift to digital

What does this entail for retailers and how do they win the battle for consumers? In this presentation we try to outline the implications and focus areas for retailers.

We see how early adoption of technology and ways of consumption is being spearheaded by Asian markets. 52% of Chinese consumers use smartphones for frequent purchases, compared to 16% in the U.S.

Page 5: Consumer Insights Survey 2018 - PwC · PwC Global Consumer Insights Survey 2018 Key Facts 3 73% of consumers say the economy will perform better or the same 88% of consumers are willing

PwC Consulting

Consumers around the world are enjoying a sense of financial stability and have become more optimistic about their ability to spend

In Sweden, 68% of the consumers are upbeat about their personal spend compared to the global average of 75%

12%

38%

Yes, I expect to spend slightly

more

25%

Yes, I expect to spend

much more

I expect to spend around the same

6%

49%

SwedenGlobal

Q: Do you feel confident about your financial situation in terms of your shopping spend for the next 12 months?

Sources: PwC Analysis, GCIS 2018 and Strategy& Business Article Competing for Shoppers’ Habits

In PwC’s seventh annual Global Consumer Insights Survey conducted in 27 countries, respondents were more upbeat about their finances compared with the previous year.

Globally 32% of the respondents are certain of that their local economy will perform better this year while 41% say their economy will stay the same.

It is a positive outlook for retailers as the consumers will not delay their purchases or cut back on spending as they are feeling less worried about the future.

13%

Page 6: Consumer Insights Survey 2018 - PwC · PwC Global Consumer Insights Survey 2018 Key Facts 3 73% of consumers say the economy will perform better or the same 88% of consumers are willing

PwC Consulting

Sources: PwC Analysis, GCIS 2018 and Strategy& Business Article Competing for Shoppers’ Habits

Better than this year Worse than this year

China 61%

Vietnam 59%

Philippines 68%

Indonesia 65%

UK 37%

Hungary 33%

South Africa 47%

Malaysia 42%

Asian countries have the most positive outlook when asked how the overall economy will perform this year

Page 7: Consumer Insights Survey 2018 - PwC · PwC Global Consumer Insights Survey 2018 Key Facts 3 73% of consumers say the economy will perform better or the same 88% of consumers are willing

PwC Consulting

Digitalisation and new technologies are changing both how retailers operates and how consumers can and will shop

7

Implications for retailers

● First movers of utilizing new technology will have a great advantage, this goes both for the internal effectiveness ensuring that your operations is working at its best, but also ensuring that your business is ready for meeting your customers’ expectations

● Prepare for your customers using the latest technology when shopping - your customers will likely not be only human in the future but rather AI shopping assistants

Handheld and wearable devices are becoming the choice for the omnichannel shopping environment. Globally, the use of mobile phones for shopping has more than doubled in the past six years, to 17%. China is driving the change with 52% of consumers frequently using their smartphones for purchases.

On the rise is also voice-assisted interactions for all kinds of needs, including shopping, through Amazon Echo, Google Home, and Alibaba’s Genie. In China 52% of respondents expect to own an AI device within a year, compared to 25% in the U.S. Moreover, 4 out of 10 smartphone shoppers say they want a shopping assistant that helps them narrow down purchasing choices.

Additionally, AI is assisting stores optimize real-time inventory and improve shelving techniques. The technology is also transforming inventory and delivery management, as well as revolutionizing how companies profile and segment customers.

Sources: PwC analysis, PwC GCIS, Beyond smartphone shopping – the rise of smart assistants, Ericsson Consumer & IndustryLab May 2018

Page 8: Consumer Insights Survey 2018 - PwC · PwC Global Consumer Insights Survey 2018 Key Facts 3 73% of consumers say the economy will perform better or the same 88% of consumers are willing

PwC Consulting 8

Google’s virtual assistant Duplex was

first showcased in 2018

The, yet to be publicly released, AI assistant can

call, interact and make reservations at shops

restaurants and barbers

Sources: Recofe.net /google-duplex-assistant-demo-voice-calling-ai

Page 9: Consumer Insights Survey 2018 - PwC · PwC Global Consumer Insights Survey 2018 Key Facts 3 73% of consumers say the economy will perform better or the same 88% of consumers are willing

PwC Consulting

Shopping in physical stores is increasing, but customers are expecting a unique experience combining in-store and online activities

9

Our survey indicates that consumers shopping in physical stores have increased, over the last years. Despite major global store closings, more than 44% of global respondents said that they shopped in stores daily or weekly (other than groceries), compared to 36% in 2014.

However, consumers today expect a completely different experience when shopping in-store, defined by a combination of value, convenience, and personal service. Delivering on this, along with integrated physical and online services, offers true value to customers.

50%

*either through customized orders in advance, in-store apps, or a mobile payment platform at checkout

Implications for retailersAs the border between offline and online is becoming increasingly blurred retailers must:

• Bring in the digital experience in the physical store and make it an inspirational experience by leveraging digital technologies such as 3D technologies (print-out custom made products), virtual fitting rooms, digital personal shopper. Combine this with value-added offline services that online never can satisfy

• Create a seamless integration between the online and offline sales channels, defining customer journeys that integrates on- and offline steps throughout the shopping experience

50% of all respondents use smartphones to complete payments at a bricks-and-mortar store*

Sources: PwC Analysis and Strategy& Business Article Competing for Shoppers’ Habits

Page 10: Consumer Insights Survey 2018 - PwC · PwC Global Consumer Insights Survey 2018 Key Facts 3 73% of consumers say the economy will perform better or the same 88% of consumers are willing

PwC Consulting 10

Samsung, Amazon and Vodafone are just a

few examples of companies utilizing their technology to

impact the retail business

Samsung launched their first commercial smart mirror earlier this year allowing hair salon customers to

experience different styles and colors

In 2017 Calvin Klein partnered with Amazon to

equip fitting rooms with Amazon Echo and Alexa to

increase the customer experience by answering

questions, adjusting lights or playing their favorite songs

Sources: The Verge.com samsung-mirror-display-hair-salon

Page 11: Consumer Insights Survey 2018 - PwC · PwC Global Consumer Insights Survey 2018 Key Facts 3 73% of consumers say the economy will perform better or the same 88% of consumers are willing

PwC Consulting

Spending more time with friends and family (57%)

Millennials lead the way in prioritising experience over products, and as they are less into shopping they pose a large challenge for retailers

Millennials lead the way in spending more on experiences over products, reasoning that prioritising time spent with family and friends is why they tend to spend more on experiences. When Millennials shop they tend to favor products and brands marketed as ethical, sustainable and environmentally friendly. Additionally, this years survey indicates that there’s a strong movement toward collaborative consumption, i.e. consumers are more open to renting or sharing rather than owning.

11

Sources: PwC Analysis and Strategy& Business Article Competing for Shoppers’ Habits, https://www.forbes.com (Millennials go minimal-the decluttering lifestyle trend that is taking over)

Implications for retailersWe predict that retailers need to provide consumers,particularly millennials, with services and products that fit into the minimalist and socially conscious lifestyle in order to be successful. This means:

● Invest in building a strong culture - your brand is a reflection of your culture● Having a clear CSR proposition (covering the end-to-end value chain) ● Implementing a circular economy approach into their business models● Position their products and services as a part of a conscious lifestyle in the

mind of their customer

Consumers rank the following top 3 reasons for spending more on

experiences in the future:

Change in priorities (to enjoy life more) (43%)

Investing in self /“me time” (37%)

Page 12: Consumer Insights Survey 2018 - PwC · PwC Global Consumer Insights Survey 2018 Key Facts 3 73% of consumers say the economy will perform better or the same 88% of consumers are willing

PwC Consulting 12

Nike is marrying the on- and offline

experience by opening up new concept stores

based on local consumer insights

The newly opened store in LA will operate as an

experimental digital-meets-physical retail

pilot, where the products and services are based on a deep understanding of local

consumer habits

Sources: News.nike.com nike-by-melrose-store-los-angeles

Page 13: Consumer Insights Survey 2018 - PwC · PwC Global Consumer Insights Survey 2018 Key Facts 3 73% of consumers say the economy will perform better or the same 88% of consumers are willing

PwC Consulting

When looking for inspiration, consumers turn to social media networks and influencers

When asked where they went online to get inspiration for purchases 37% chose social media, with individual retailer websites at 34%. The reliance on social networks is 52% in China compared to Sweden where 27% of the consumers find inspiration on social networks.

Consumers source inspiration from their peers and different influencers on social media, with 20% of respondents cited Snapchat and Instagram. Additionally, there’s an increased sense of trust towards influencers that are not getting paid for their acknowledgement.

13

Implications for retailers

• Rethink your marketing strategy and work actively on defining your target audience

• Use data analytics to ensure that you really understand and get to know your customers’ behavior and their preferred way of communication

• Focus your budget on where your customers spend time and where they look for inspiration. Don't overspend on traditional marketing

• Use influencers to position your product or service

• Stay on top of the latest social media networks, connect your sales channels to Instagram, WeChat etc. or anywhere your target audience spend a lot of time

Sources: PwC Analysis and Strategy& Business Article Competing for Shoppers’ Habits

Page 14: Consumer Insights Survey 2018 - PwC · PwC Global Consumer Insights Survey 2018 Key Facts 3 73% of consumers say the economy will perform better or the same 88% of consumers are willing

PwC Consulting 14

Watchmaker Daniel Wellington and H&M

are mastering influencer marketing

Daniel Wellington earned $63 Million in media value

in 2017

H&M has 26,4 Million followers on Instagram

(Aug, 2018)

Sources: Influencer DB best-performing-influencer-marketing-campaigns-of-2017/

Page 15: Consumer Insights Survey 2018 - PwC · PwC Global Consumer Insights Survey 2018 Key Facts 3 73% of consumers say the economy will perform better or the same 88% of consumers are willing

PwC Consulting

Global mega-players are changing consumers expectations and habits, disrupting retail as we know it

A recurring trend in our annual survey is the continued push towards online shopping. 89% of the respondents in the US use Amazon.com, 90% in the UK and 94% in Germany (24% in Sweden where Amazon is yet to launch). Amazon and its competitors are massive game changers by the way they reshape and reinforce consumer habits and expectations. By providing value and convenience to their customers by excellent online experience they are disrupting the market.

15

Någon mer implication

Implications for retailers

As a retailer you need to evaluate how a global third-party platformmarket entry will impact your business:

• What is the likelihood and timeline for a third-party platform market entry?

• What are the different scenarios for such a market entry?

• What are the main strategic options? Can we leverage an entry as a market opportunity (strategic partner, alliances, act as vendor to or seller on the platform, etc.)? Or what defensive and offensive moves could be taken in the market (partnerships, M&A, increased omni-channel investments)?

36% of Amazon’s

customers already pay for Amazon Prime and get

access to unlimited free delivery

Nearly 60% of global consumers regularly shop on platforms such as

Amazon, Wish and Alibaba. In China,

98%, virtually

everyone uses JD.com or

Tmall

Sources: PwC Analysis, Strategy&Business Article Competing for Shoppers’ Habits, https://www.digitalpulse.pwc.com.au/managing-online-retail-globalisation/

Page 16: Consumer Insights Survey 2018 - PwC · PwC Global Consumer Insights Survey 2018 Key Facts 3 73% of consumers say the economy will perform better or the same 88% of consumers are willing

PwC Consulting

Implications for retailers • It’s not solely about solving the last mile delivery - that's just one aspect of it. You have

to consider three components, Delivery, Service and Returns and how these are connected• Be aware of what is driving your costs and innovative by investing in areas such as big data and

analytics, robotics, automation and AI. This will allow you to more accurate demand forecast, warehouse process optimization and optimize your logistic network and footprint

• Also evaluate potential partnership with vendors and the global mega players – be part of a global ecosystem rather than develop everything on your own

Global forces together with new customer habits and demands are re-shaping last mile delivery and returns for retailers

Our survey illustrates that more than 40% of the global consumers are willing to pay for same-day or instant delivery. Specifically younger consumers are using these services, indicating that this type of delivery option will increase.

Globally, 36% of Amazon’s customers already pay for Amazon Prime with unlimited free delivery. With the continued development of e-commerce, consumer preference of instant delivery as well as returns puts a lot of pressure on retailers as delivering to customers is expensive and time-sensitive.

Solving the last-mile delivery and return challenge is a key differentiator for retailers in order to provide the best possible customer experience.

Chinese E-commerce giant JD.com is experimenting with drones and self

driving parcel delivery vehicles

Sources: PwC Analysis, Strategy&Business Article Competing for Shoppers’ Habits

Page 17: Consumer Insights Survey 2018 - PwC · PwC Global Consumer Insights Survey 2018 Key Facts 3 73% of consumers say the economy will perform better or the same 88% of consumers are willing

PwC Consulting 17

Global Mega-players are increasingly

investing in automation across the

entire value chain

JD.com invests heavily in automation and LMD capabilities. Their new warehouse in Shanghai

can handle over 200,000 packages daily, while

employing only four people

Sources: Axios.com china-jd-warehouse-jobs-4-employees-shanghai

Page 18: Consumer Insights Survey 2018 - PwC · PwC Global Consumer Insights Survey 2018 Key Facts 3 73% of consumers say the economy will perform better or the same 88% of consumers are willing

PwC Consulting

Implications for retailers

• Ensure that the management of customers’ personal data really is in good care and work proactively to minimize the risk of cyber attacks etc.

• Understand and work actively with Net Promoter Score and your customer experience. Design your site and customer journeys, having trust in mind

In order to create a fully tailored shopping experience for consumers retailers need to leverage its most important asset - data

Our survey illustrates that over 40% of our global respondents are willing to share data with retailers such as shopping pattern and purchases. In return they expect retailers to have up-to-date information in order to tailor messages and a customized shopping experience.

Brand trust is ranked among the top three reasons when global consumer choose where to shop online. Consumers are taking concrete actions with whom they share data in order to minimize risks online.

Only use credible/ legitimate websites

Minimise the amount/ type of data I give out

57%

51%

34%

29%

21%Only purchase from retailers in my country

How do you personally reduce the risk of online security issues/fraud?

Sources: PwC Analysis, Strategy&Business Article Competing for Shoppers’ Habits, strategy-business.com/feature/Competing-for-Shoppers-Habits?gko=e65db

Page 19: Consumer Insights Survey 2018 - PwC · PwC Global Consumer Insights Survey 2018 Key Facts 3 73% of consumers say the economy will perform better or the same 88% of consumers are willing

PwC Consulting 19

Consumers are more willing to share data

with brands they trust

Google is ranked as the world’s third most

reputable company after Rolex and Lego, which in turn could be viewed as a

large differentiator by consumers shopping online

Sources: Forbes.com the-worlds-most-reputable-companies-2018

Page 20: Consumer Insights Survey 2018 - PwC · PwC Global Consumer Insights Survey 2018 Key Facts 3 73% of consumers say the economy will perform better or the same 88% of consumers are willing

PwC Consulting 20

Consumer Insights Survey 2018

-

PwC’s Point of View

The global trends highlighted in the survey are undisputable and are

only growing stronger

Although described in different ways, the vast majority of companies are well aware of which way the

world is moving and are reflecting over ways to meet these opportunities

and challenges

However, now is not the time of reflection, but execution

Page 21: Consumer Insights Survey 2018 - PwC · PwC Global Consumer Insights Survey 2018 Key Facts 3 73% of consumers say the economy will perform better or the same 88% of consumers are willing

PwC Consulting

2. Create an omnichannel experience

Elevate the retail experience by creating a seamless integration between on- and offline sales channels to create a inspirational and attractive customer journey

21

Go hack yourself! Ensure that your organization not only has a thorough understanding of disruptive technologies, but also how to utilize and implement them

1. Invest in and understand new technologies

Invest in and develop a transparent, end-to-end, CSR strategy that caters to minimalistic and socially conscious consumers to really build brand trust in the market and among consumers

3. Your CSR strategy needs to be more than a policy

Drawing insights from data to better understand your customers is old news - However, ensuring that customers trust your organization and cyber security is key for retailers seeking to harness data

5. Data is silver but trust is gold

Find your ecosystem sweet-spot and prepare how to tackle the global mega-players, whether by partnerships, mergers, acquisitions or alliances

4. Play an active part in both local and global ecosystems

Key focus areas for retailers to execute on going forward

Page 22: Consumer Insights Survey 2018 - PwC · PwC Global Consumer Insights Survey 2018 Key Facts 3 73% of consumers say the economy will perform better or the same 88% of consumers are willing

PwC Consulting

Thank you!

2018 PwC. All rights reserved. Not for further distribution without the permission of PwC. “PwC” refers to the network of member firms of PricewaterhouseCoopers International Limited (PwCIL), or, as the context requires, individual member firms of the PwC network. Each member firm is a separate legal entity and does not act as agent of PwCIL or any other member firm. PwCIL does not provide any services to clients. PwCIL is not responsible or liable for the acts or omissions of any of its member firms nor can it control the exercise of their professional judgment or bind them in any way. No member firm is responsible or liable for the acts or omissions of any other member firm nor can it control the exercise of another member firm’s professional judgment or bind another member firm or PwCIL in any way.18 Per firm’s professional judgment or bind another member firm or PwCIL in any way.

Confidential information for the sole benefit and use of PwC’s client22

Katia Rigbrandt+46 709 29 30 [email protected]

Peter Malmgren+46 723 53 00 [email protected]

Maria Brehmer+46 725 29 81 [email protected]

Irwinder Dhindsa+46 729 80 95 [email protected]

William Jilltoft+46 729 80 91 [email protected]